BiggerPockets

Is there a good database or do you just hop from each banks website and search for properties?

Almost all REOs are listed on the MLS. So, if you can get access to the MLS, that's your best bet. If not, find a realtor and ask them to send you the REOs that fit your criteria. Alternatively, you can use any of the vast number of Internet sites that provide access to most MLS data.

Bank websites like BOA and Fannie/Freddy have REO's listed.

Wow thanks Josh! Nail on head...this was exactly the type of list I was looking for. I don't know how I overlooked that here.

If the REO is listed with an agent and on the MLS, there will be time to put a loan in place. If it a bulk sale from the bank, no there will not be time for a loan. Proof of funds is required up front.

Another question.

An agent said that the bank has restrictions on getting a contractor or inspector to look at the property? Does this mean I can't have an inspection contigency?

Is it possible for you to get your contractor and inspector in the property before you put an offer in? This way you know where you stand before the offer goes in. I'd hate to get it under contract and then be bound by the banks rules.

Curt,

Thanks for the reply. There is a bank owned property on the MLS and I called an agent they said the bank won't allow for inspection once under contract. Do you think the agent is mistaken?

That seems crazy. Who on earth would by without an inspection?

Interesting Jon. I'll see if I can get a "showing" and bring an inspector through. The bank doesn't need to know he's an inspector...lol.

I did seem a bit odd that the bank requested no inspections. I guess a well seasoned investor that knows how to throughly inspect a property himself would be a buyer here.

First, as Heather pointed out, it's not true that you can't get financing for an REO. In fact, you can get any type of financing you want (and can get). The banks may not consider your offer as seriously if you are getting conventional financing, but there is absolutely no rule that states that you can't get a traditional loan against an REO.

As for inspecting the property, my guess is that the bank is stipulating that you have no "due diligence period" after the contract is signed. This means that once the contract is binding (all parties have signed it), you don't have any time period in which you can back out and get your deposit back.

But, the bank certainly shouldn't limit your ability to enter the property as much as is reasonably needed, for things like inspections, contractor estimates, appraisals, etc.

In fact, I'd be surprised if the bank even knew that you were entering the property; it's normally the job of the listing agent to grant you access, though your agent should be able to do so as well. Especially since all REO properties are vacant, so you don't have to worry about disturbing the home-owner.

My suggestion is to tell your agent flat-out that you expect to have access to the property as much as need-be. If he/she can't ensure that will happen, find another agent.

Maybe the agent is confusing "as is" for "no inspection". That's certainly an incorrect interpretation. Not to mention my experience is that banks will actually negotiation based on the outcome of the inspection.